Chad’s Economy Grapples with Financial Crime Amidst Political Turmoil

Chad, a landlocked Sahelian country already facing security challenges and the effects of climate change, is struggling to combat poverty and vulnerability. A recent report highlights the devastating impact of financial crime on Chad’s society.

Poverty and Vulnerability

The report estimates that by the end of 2023, some 600,000 people could arrive in Chad, adding to the country’s existing refugee crisis. With over 42% of the population living below the national poverty line, extreme poverty has risen significantly from 31.2% in 2018 to 35.4% in 2023.

Human Capital Index

The World Bank’s Human Capital Index for Chad is a dismal 0.30, indicating that children born today will be 70% less productive as adults than those who have received quality education and healthcare. Furthermore:

• One in five Chadian children will not reach the age of five.
• Stunted growth affects 40% of Chadian children.

Political Turmoil

Since the death of President Idriss Déby Itno in April 2021, Chad has faced political turmoil. The country’s Transitional Military Council led by his son, Mahamat Idriss Déby Itno, took over and suspended the Constitution. The opposition protested against the extension of the transition period, resulting in bloody demonstrations that claimed an estimated 128 lives.

Economic Outlook

Despite these challenges, Chad’s economy is expected to record its strongest performance since 2014, with GDP growth estimated at 4.1% in 2023. However:

• Falling oil prices pose a downside risk.
• Political instability during upcoming elections and rising insecurity are potential threats.
• Climatic shocks could also impact the economy.

Future Prospects

The country’s extreme poverty rate remains high, with an additional 237,479 people expected to fall into extreme poverty in 2024. A prolonged war in Sudan beyond 2023 would worsen the humanitarian crisis, weigh on public finances, and increase inflationary pressures.

Conclusion

As Chad navigates these challenges, it is clear that addressing financial crime and promoting economic stability will be crucial for the country’s future development and prosperity.